Thought Leadership

Bringing Clarity to a Murky Programmatic Supply Chain

August 19, 2019

By Molly Visgilio, Senior Account Executive

This article was originally published on MediaVillage on July 26, 2019.

Ever since P&G’s Marc Pritchard told the digital supply chain to “grow up,” the programmatic space has made strides to build greater accountability. Ads.txt verification and broader measurability have been a good start, but programmatic is still too complicated for its own good.

To help tame some of this complexity, buyers are beginning to engage in the process of Supply Path Optimization (SPO). While SPO may seem like another tortured adtech buzzword, it is entering the mainstream as buyers move to dramatically slim down the number of exchanges they work with.

Rooted in the rise of header bidding, SPO aims to simplify the murky programmatic supply chain by eliminating waste, hidden fees, and brand safety risks that come with buying through non-vetted supply sources. More than a supply “clean up,” SPO presents a unique opportunity for brands and agencies to think differently about exchanges. Buyers who have been most successful with SPO have stopped looking at exchanges simply as pipes that need to be snaked clean and have instead started looking at exchanges as potential partners. These budding partnerships are poised to be the foundation for future innovation in digital marketing.

While the principle of cleaning up the supply chain is easy enough for buyers to rally behind, getting started with SPO can be overwhelming. The good news: The SPO journey does not have to be walked alone. Buyers can and should look to their trusted exchange partners to arm them with SPO-specific resources. These can take the shape of SPO guides, RFI templates, suggestions on what data to look at and how to avoid paralysis by analysis. These materials and conversations can help buyers establish and effectively weigh the criteria that matter most to their business, aiding in consolidation decisions. The key to these criteria is not overcomplicating it.

While consolidation criteria will vary from buyer to buyer, it tends to center around three key priorities: inventory access, transparency and quality, and partnership. There are few exchanges with the global, omnichannel, high-quality footprint that buyers need to operate in the current programmatic landscape. Even fewer have the resources and vision to service buyers as the landscape continues to evolve. The partnership criteria are perhaps the most critical because the benefits of SPO aren’t fully realized by the act of consolidation alone. Partnerships are the best way for buyers to ensure long-term success.

Buyers can do more with fewer, bigger, stronger exchanges, but only if those exchanges are willing and resourced to innovate with buyer marketing goals in mind. Imagine: a buyer, a DSP and an exchange actually sitting in a room together, aligning roadmap priorities and building out joint programs. Buyers who leverage their consolidated buying power for deeper exchange collaboration will achieve better outcomes with their media spend.

A world in which buyers and exchanges work together to create a more robust programmatic landscape is the real potential of SPO.